Sell Now and Rent an Apartment Home

For many reasons, a lot of baby boomers have been delaying retirement. One reason is that they have been unable to sell their homes. They've been trapped in our old houses, in their high-tax communities, handcuffed to jobs by a lofty cost of living. They couldn't afford to retire until they could move to a cheaper home.

But now the real estate market is improving. According to the Standard & Poor's/Case-Shiller home-price index, the number of existing homes sold is up more than 8% from a year ago, and average prices have climbed 12% since this time last year.

Now the question is: If you can finally sell your home and move to a retirement destination should you rent your new place, or should you buy again?

Let's remember that despite the lousy real estate market of the recent past, most boomers have made a lot of money owning their own homes over the past 30 years. For most of their lives – and their parents' lives– owning a home was the American dream.

The rule of thumb was that it was better to own than to rent, as long as you planned to stay in your house for at least five years.

But that was then. What about now? What we've all learned since 2006 is that owning a home can be an albatross as well as an opportunity. Many people now seem more interested in mobility than stability. You can't retire and you can't take that new job if you can't sell your house.

And maybe you just no longer want the responsibility of taking care of a lawn and doing maintenance on the roof and the plumbing and the heating system.

Many of us know – and are a little jealous of – a friend or relative who was renting an apartment or a condo and was able to take a new job or jump on an early retirement package, then wave goodbye and start the new life they wanted.

Now that homeowners have the chance to move, do you really want to be saddled with another place you may not be able to sell?

Certainly, if you're experimenting with your retirement, shopping for a new place to live, you should not buy a place right away. Remember, buying and selling a house costs a lot of money – not just the down payment, but the mortgage, the lawyer, the insurance and taxes.

If you're not sure, rent for a year or two.

Above all, the choice of whether to rent or buy is a lifestyle decision. What kind of home and neighborhood you want to live in, whether you want to feel like a part of the community and how long you are you going to stay there.